"Mexico is our highest-conviction long idea for 2014," the firm said in a letter to clients, a copy of which was obtained for Bloomberg News. "During 2013, Mexico has undertaken the most ambitious and revolutionary reform agenda of all emerging markets. On a global basis, its reform agenda even exceeds Japan's in our view."

Citrone started South Norwalk-based Discovery in 1999 and last year returned 27.5 percent from its main fund, according to an investor report.

Mexico's perceived creditworthiness has soared since President Enrique Pena Nieto was elected in 2012 on pledges to open the state-controlled energy industry to more private investment and boost tax revenue. Fink, who runs the world's largest money manager as BlackRock's CEO, said last year the plan would turn Mexico into one of the world's biggest energy producers and unleash an investment boom -- making the nation his favorite international destination to put money.

Macro funds, which seek to profit from broad economic events by trading everything from bonds to commodities, lost about 2.2 percent last year.

Discovery said it expects the dollar to rally against most currencies this year, fueled by a tightening of monetary policy and a reduction in the current account deficit. It also said it expects the Standard and Poor's 500 Index to gain about 10 percent to 12 percent this year. The index rallied 30 percent in 2013.

The firm said it's betting against an unnamed "high-cost" U.S. iron ore producer and a "major miner," as well as a European and two north American copper producers.

"While most industrial metal prices will likely suffer as China restructures, we are most convinced about copper and iron ore," the hedge fund-firm said, citing an expansion of production capacity between 2013 and 2015 by BHP Billiton, Rio Tinto Group, Vale and Fortescue Metals Group.